US financial institutions are breathing easier after the Treasury acknowledged difficulties in complying with forthcoming regulations on customer identification.
In a report to Congress, the Treasury has accepted banking industry concerns about onerous record-keeping requirements arising out of ID verification rules which were set to be introduced next week under section 326 of the US Patriot Act. Banks were particularly fearful about rules relating to tagging previous accounts and verification of foreign nationals opening new accounts.
Discover Bank claimed compliance with the proposed rule changes would have added $8.4 million to its in annual operating costs, in addition to a one-off programming bill of $4.6 million.
The Treasury is delaying the introduction of the new rules while further consultations take place.